Forward-thinking B2B businesses going into B2C and D2C use composable commerce to tackle the differences across business models, such as storefront design and pricing logic, without fragmenting their eCommerce footprint.
In the business world, companies have traditionally been categorized by the sales model they employ, using descriptives such as B2B (business-to-business), B2C (business-to-consumer) and D2C (direct-to-consumer). However, as you may have noticed or even experienced first-hand — the reality is companies are operating differently today. Many companies don’t fit into a single description anymore, and ones that do are probably considering diversifying. After all, it’s clear that a company can be (and sometimes should be) B2B, B2C, B2B2C and D2C.
Quite a few B2B companies have already discovered the benefits of diversifying and the media has been happy to publicize this shift. As a result, more and more B2B companies are eagerly exploring opportunities, flirting with B2C and, more recently, with D2C strategies. Considering that D2C eCommerce sales grew 45.5% in 2020 in the US alone, it makes sense that taking charge of direct customer relationships instead of relying on middlemen is becoming big business — and eMarketer predicts the trend will continue to grow — to a tune over 14% year-over-year until 2023.
According to Gartner*, a staggering 83% of B2B buyers now prefer ordering or paying through digital commerce.
Truth is, a business model agnostic approach isn’t new. Many big brands such as M&M Mars, Nike and The Home Depot all have been running more than one business model (B2C and B2B) successfully for a long time. However, business diversification gained traction over the past few years. For example, startups including Casper, Bark Box and Dollar Shave Club, which all started as D2C businesses, all now also have B2C channels.
The COVID-19 pandemic was key to this change as many traditional B2B businesses were forced to shift to exclusively selling via eCommerce — feeding a reported 10% annual B2B eCommerce sales growth in the US alone through 2023. According to Gartner, a staggering 83% of B2B buyers now prefer ordering or paying through digital commerce. And once a B2B has their eCommerce running smoothly and they’re reaping the benefits, it only makes sense that they’re looking beyond — and realizing the immense opportunities of diversification.
Leaders blending B2B and B2C/D2C
With revenues topping €24B, Danone, leading global producer of healthy, responsibly produced food and drink, initially turned to commercetools and Google Cloud to help them create a foundation that could support the growth of their B2B eCommerce channel. The Paris-based company quickly found that the cloud-based, composable solution enabled them to develop and deploy storefronts across multiple markets within weeks. As a result, when the pandemic drove baby formula shortage , the company was able to respond quickly, launching a D2C solution by simply adding a cart function to their existing brand websites. Danones’ UK healthcare division also leveraged the agility of the solution to add functionality that enables B2B customers to order medical samples directly. Not only does it streamline the process for consumers, it’s also helping the company gather important data on who its consumers are, and how they’re using their products.
Cimpress (NASDAQ GS: CMPR), a mass customization printing company (and the parent of VistaPrint, National Pen and others, also discovered the benefits of the flexible architecture of the commercetools solution during the pandemic. In 2019, the $2.6B company migrated both their B2B and B2C businesses to commercetools because they needed a solution with the power to handle their planned global rollout as well as the ability to integrate with multiple storefronts. Later that year, when COVID hit, their Vistaprint division made a strategic decision to pivot their business focus, deciding to introduce stock and custom-printed face masks as a new product line. According to Gary Schorer, Director of Technology, the flexibility and agility of their technology helped make it happen. “We had live prototypes up in a matter of a few days and were able to go live in something like two or or three weeks. We were not only able to pivot, we were able to pivot in a big, impactful way.”
The technological foundation for multi-model strategies is composable
Even as the lines between B2B, B2C and D2C are becoming blurry, each model has specifics that cannot be ignored which impact how eCommerce is designed, implemented and managed.
For instance, B2B buyers may not need to be wowed when deciding on a supplier, yet they require a convenient and pain-free experience. Most also have long-standing relationships with their providers and want to be able to place recurring orders as well as receive volume discounts. On the other hand, consumers are less likely to repeat purchases for non-commoditized products. Instead, they’re driven to purchase based on seasonality, instant gratification, promotions, pick-up and delivery options. free shipping, etc. Brands that deliver to these expectations are rewarded with customer loyalty.
These distinctions translate into dedicated marketing strategies, buying processes, storefront design, pricing logic, customer experience and loyalty programs that companies must address. At the same time, they shouldn’t discard the synergies that exist — such as between product data, catalogs, inventory and check out.
The first inroads into multi-model eCommerce replicated those differences and ignored the synergies. Characterized by unwieldy systems of old, also known as monoliths, companies using them discovered they came with limitations that effectively made it impossible to support multiple business models on a single platform. The result? Companies had to deploy one eCommerce system per business model, creating operational silos and IT fragmentation and leading to inconsistent product, pricing and customer data across their eCommerce footprint.
...companies need to consolidate their eCommerce footprint in a centralized commerce engine, plus have the flexibility to use best-fit components, such as checkout, product information management (PIM) and differentiated storefronts…
In addition, using disparate technologies inflates the associated licensing fees, add-ons, services and customizations. These costs grow year on year into a bloated TCO (total cost of ownership) that is far too expensive to maintain and invest over time — clearly, implementing separate systems for every business model is not a sustainable strategy. Instead, companies need to consolidate their eCommerce footprint in a centralized commerce engine, plus have the flexibility to use best-fit components, such as checkout, product information management (PIM) and differentiated storefronts, to shape and tailor customer experiences according to each business model.
This is why composable commerce, founded on MACH principles (Microservices-based, API-first, Cloud-native and Headless), has become the go-to eCommerce architecture for the likes of Danone, Cimpress and hundreds of other B2B companies.
Starting your multi-model journey with commercetools
Whether you’re just starting your digital transformation or exploring ways to expand your eCommerce to B2C/D2C without fragmenting your tech stack, commercetools Composable Commerce is the right solution to pivot between B2B, B2C and D2C without missing a beat.
Start your multi-model journey with a leading Composable Commerce solution that offers an API portfolio and data models that have hailed recognition from big-name analysts such as Forrester, Gartner, and B2B Paradigm. Armed with a flexible technological foundation, you can future-proof your business no matter where you’re headed next.